U.S. sued over approval of Kentucky Medicaid work provisions

(Reuters) - A group of Kentucky residents has filed a lawsuit challenging the federal government’s approval of new state requirements that people must work or get jobs training if they are to receive benefits from the Medicaid health insurance programme.

The proposed class action lawsuit, filed in Washington federal court against the U.S. Department of Health and Human Services (HHS), says the agency exceeded its authority under the federal Medicaid law when it approved Kentucky’s requirements earlier this month.

A spokesman for the Centers for Medicare & Medicaid Services, the branch of HHS that oversees Medicaid, declined to comment. The office of Kentucky Governor Matt Bevin did not immediately respond to a request for comment.

Kentucky’s new requirements mandate that able-bodied Medicaid recipients participate in at least 80 hours a month of “employment activities,” including jobs training, education and community service. The rules, which the state expects to begin implementing in July, cover people from 19 to 64 years old, exempting some groups including pregnant women and former foster care youth.

They were approved through a process that allows states to receive “waivers” from federal Medicaid law to test new approaches to the 50-year-old programme.

The plaintiffs said in their complaint that, rather than testing a new approach, Kentucky had “effectively rewritten” the federal Medicaid law.

In addition to work requirements, the state’s programme imposes premiums on most Medicaid recipients based on income. Some who miss a payment or fail to re-enroll will be locked out for six months.

Wednesday’s lawsuit challenges those requirements as well. It was filed by 15 Kentucky Medicaid recipients and seeks to represent a class of Kentucky residents enrolled in the programme since Jan. 18.

The plaintiffs said they risked losing coverage under Kentucky’s new programme. Several have variable work and inconsistent income, and fear they will be unable to pay premiums or be locked out of Medicaid after failing to meet requirements, according to the complaint.

They brought claims under the federal Administrative Procedure Act and the U.S. Constitution.

Attorneys at the National Health Law Program and Southern Poverty Law Center, left-leaning national advocacy groups, are among those representing the plaintiffs.

Kentucky was among 31 states that expanded Medicaid to those earning up to 138 percent of the federal poverty level under the Affordable Care Act, former Democratic President Barack Obama’s signature domestic policy achievement.

More than 400,000 Kentucky residents gained health insurance through the programme, the highest growth rate of Medicaid coverage of any state.